FEB 6
18 SIT EC y POL
ND denounce Global-neoliberal
debacle y propone State-Social + Capit-compet in Econ
ZERO HEDGE ECONOMICS
Neoliberal globalization is
over. Financiers know it, they documented with graphics
1-So,
first things first, the total catastrophe that is the Inverse VIX ETF XIV
dropped 90% in after-hours trading, triggering its termination event...
2-And then when it re-opened, it
crashed some more before squeezing higher (remember it will be at $4.22 on Feb
20th, no matter what happens in between)...
3-And in yet another example of the
market's sheer idiocy, this short-squeeze sent The Dow up 600 points... pay attention to this Chart
4-Notably, S&P 'VIX' was the
biggest mover across all the indices...
5-Nasdaq, S&P and Dow managed to
get back into the green for 2018...
6-Nanex's Eric Scott Hunsader showed liquidity
has evaporated from US equities - Liquidity rising from "Lord
of the Flies" to "Banana Republic". Still ridiculous
(black=today)
7-Credit markets have started to
awaken...
8-But for now, FX, rates, and
Commodity vol remains 'contained'..
9-The yield curve flattened
dramatically intraday..
10-The Dollar Index ramped back to
pre-Mnuchin-Masscare levels, tagged those stops, then dumped back into the
red...
See all these Charts in this source:
https://www.zerohedge.com/news/2018-02-06/volmageddon-sparks-6000-pt-swings-dow-liquidity-evaporates
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"...the corporate sector’s
animal spirits may soon give way to primal fear: the market rally is already running out of
steam, and Trump’s
honeymoon with investors might be coming to an end..."
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"...there's going to be a
bigger problem than 2009 and 1929, eventually. A major storm is
coming...The market has become a much
more dangerous place [due to index funds and ETFs]"
Billionaire investor Carl Icahn spoke to CNBC via telephone this morning and had some very
ominous warnings after what he has seen in the last few days.
Reflecting on the market's moves recently, Icahn shocked the
anchors by saying:
"This
is something we've never seen before... I
don't remember ever seeing a market with this kind of volatility over two
weeks."
"The market has become a much more dangerous place [due to index funds and
ETFs]... it's like 2008 where everyone was
buying mortgages and CDS."
Concluding that: "Passive investing is the bubble right
now."
"There is going
to be a major, major, major correction."
"This is a manifestation of a real deep problem we have
in our markets."
"There is a huge bubble of passive money flowing in... a sort of euphoria and a lot of people are going to pay the price just like in 1929."
Icahn then took his warning to 11...
"I do think the market will
bounce back but these are the rumblings
before the earthquake."
"The market is
telling you something... it's telling you it's very dangerous...it's way over-leveraged."
Which, as we noted
previously, is a fact...
SEE Chart at:
And that is one reason why Icahn fears...
"Eventually, there's going to be a bigger problem than 2009 and 1929,
eventually.
A major
storm is coming, could be 5 years, could be 5
months."
Icahn ended by noting that "no one can tell you
what the market is going to do - its almost farcical to think you can," but added that this is what he
thought would happen, based in his research.
SEE VIDEO
As a reminder,
Icahn warned previously,
"I am still concerned that one day you'll see a break like you had
a few weeks ago...but it won't come back."
CNBC, of course, was
careful to provide some cover for their advertisers, noting
that while
Icahn said "this casino is on steroids -- the market is a casino on
steroids," they add that the veteran market-watcher said, this is not "the
explosive time."
…
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Gross’s
$2.2 billion "unconstrained" fund, the Janus Henderson Global
Unconstrained Bond Fund, tumbled by 0.83% as markets plunged Monday, sending it
back into the red for the year.
See Chart: Janus Henderson
Global; Unconstrained Fund. YTD performance
To be sure, the one-day loss clearly
paled against the record 1,175-point crash in the Dow Jones Industrial Average,
the move comes at a time when Gross has correctly called the recent rout
in bonds, having recently declared the onset of a "mild
bond bear market" before the 10Y yield spike
While the reason for the sharp daily drop is unclear, Bloomberg notes there are several possible
explanations including:
- The volatility spike: As a source of higher returns, his fund relies on selling the equivalent of insurance against big market moves. “Higher volatility in markets present opportunity to earn higher returns by selling volatility not cash bonds,”Gross said in a Tweet posted Monday. In retrospect, he may have sold a little too much.
- Duration, or interest-rate sensitivity, that Gross recently put at minus two years, meaning the fund is positioned to benefit from rising bond yields. Ten-year U.S. Treasuries fell almost 14 basis points on Monday, the largest decline since September. “As yields go up and bond prices go down, the fund makes money,” he said in a Feb. 1 email. Of course, yields dropped sharply on Monday amid the flight to safety, which could have resulted in the substantial underperformance.
- Holdings tied to currencies, commodities or other assets. When the fund’s returns slid at the end of December, he attributed it in an email to “an unanticipated decline in the dollar, which led to a gold price increase. The fund was short gold at the time.”
Gross’s Janus fund, which holds a sizable portion of his own
personal fortune, has returned an average of just 2.2%
annually over the last three years, ranking in the bottom half of its
Bloomberg and Morningstar peer groups.
…
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The Story tell that the FED didn’t give
enough money for big bankers and
speculators to feed their voracious gluttony. IS LATE, even
with more QEs.
THE POISONOUS SNAKE-FAMILY HAS TO
START EATEN THEIR OWN TAIL
ETPs had to buy 282,000 VIX futures to rebalance their short
gamma: "this
was the largest VIX buy in history, dwarfing Friday’s previous record of
78,000."
Less than a month ago, Goldman
Sachs presciently published a note research report "VIX
ETPs are now net short vega - should we worry"...
.... which
as the title suggested showed that the net position of VIX ETPs has become
short over the past few weeks, for only the second time in their eight year
history.
See chart:
Less than a month later we have
the answer: Yes, Goldman, you should worry,because the historic short squeeze that took place overnight
in VIX, which sent it over 100% higher - the biggest jump in history - was
precisely a result of this Goldman observation, namely that ETPs were now
aggressively shorting vol.
Here is what happened - as
Morgan Stanley explained overnight - following this
first ever shift by ETPs to net short vega, a move that in retrospect
will prove to be suicidal for the entire industry, which now faces one giant termination event.
In short, "the VIX market saw the biggest net buying
pressure on record." .. "this
was the largest VIX buy in history, dwarfing Friday’s previous record of
78,000." Dealers
hedging their short gamma exposures likely contributed to VIX futures demand as
well.
According to Morgan Stanley this move was "incredible" particularly because VIX and VIX futures were already elevated –
and the amount of volatility to buy exceeded the bank's
already aggressive estimates (below shows what QDS estimated coming into
Monday) and speaks to the size of the short vol
exposures in the market:
See chart: blocked now
See it at the source below: OPEN: VIX Features to be bought as the S&P
500 Declines COMING INTO MONDAY –MUCH LOWER AFTER
While this explains the theory, the
question is what happens in practice next: will the
inverse ETPs - like XIV - continue to exist today? This is up for debate
at time of this writing, but for the broader market the implication is clear: the inverse
ETPs have effectively delevered down to zero, going from short 230,000 VIX
futures to short just 4,000.
The good news from the
effective wipeout of a major part of the vol-selling market is that "this means there is much less
risk going forward of further vol to buy from rebalancing of these
products."
The bad news: holders of the
inverse ETPs lost $3.4bn as the products went nearly bankrupt and this removes
a steady source of volatility supply over the last year.
….
Source:
https://www.zerohedge.com/news/2018-02-06/here-what-was-behind-largest-vix-buy-order-history
…
RELATED VIDEO: at Markets Check : Market
Data, 10 a.m. EST
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The record surge in the VIX crushed
a Chicago-based fund which sells vol and according to a letter from its founder,
the fund suffered
"significant losses" which sent its NAV down more than 50%.
See chart:
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POLITICS
Seudo democ y sist duopolico in US is obsolete; it’s full of frauds & corruption. Urge
cambiarlo
Al-Qaeda has heat-seeking anti-aircraft missiles (MANPADS) and controls
land near the Mediterranean coast
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"...the revolving door between Wall Street and Washington is very
real. It is also one of the most powerful and influential aspects of
government. Power and money
have no real party allegiance. See, no matter who sits in the White House, dark
money calls the shots."
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WORLD
ISSUES and M-East
Global depression is on…China,
RU, Iran search for State socialis+K- compet. D rest in limbo
FALSE INFO: Check Sputnik below
China is preparing for a potential
war on the Korean Peninsula by reinforcing missile defenses near the border
with North Korea, South Korea's Chosun Ilbo reported on Tuesday.
===
DEMOCRACY
NOW
US politics crisis: Trump
captured by Deep state to reproduce old cronyism without alter-plan
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GLOBAL
RESEARCH
Geopolitics & Econ-Pol
crisis that leads to more business-wars:
its profiteers US-NATO
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INFORMATION
CLEARING HOUSE
Deep on the US political
crisis, their internal conflicts n chances of WW3
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FISA-Gate: The Plot To Destroy Our Republic By Justin Raimondo
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COUNTER
PUNCH
Dean
Baker On
the Market Crash: Calm Down
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SPUTNIK
and RT SHOWS
Geopolitics & the nasty
business of US-NATO-Global-wars uncovered ..
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RELATED 1:
DOW JONES STOCKS TOOK
LOSSES all 30, ranging from 2.5 to 5.7 percent,
with Boeing, Exxon Mobil, and United Technologies among the hardest
hit.
RELATED 2:
RELATED 3:
current wave
of market volatility is still difficult to assess.
RELATED 4:
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RELATED
1:
RELATED
2:
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The Dow Jones industrial average picked
up 567 points, or 2.33 percent, Tuesday after Monday's 4.6 percent
fall. Sankey
observed that some investors may be trying to buy assets
at relatively discounted prices, betting that the bull market will
continue. "Some investors are trying to take
advantage of a temporary, or potentially temporary, depression
in prices… they're trying to take advantage of this dip and buy
some things on the cheap," the analyst said.
RELATED
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In January, Turkish Foreign Minister Mevlut Cavusoglu said that Ankara
would not limit its precautionary measures against Kurdish fighters to Syria's
Afrin but could move to Manbij, where the US has some
2,000 of its military personnel deployed. United States should leave
Syria's Manbij in Aleppo province as Ankara plans to return it "to its true owners."
RELATED
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RT SHOWS
Keiser Report Episode
1185 Max and Stacy discuss bankers
getting arrested for manipulating precious metals prices and millennials
signing up for cryptocurrency trading apps by the millions
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NOTICIAS
IN SPANISH
Latino America looking for
alternatives to neoliberalism to break with Empire:
COL -A
Garcia: “El ELN quiere la Paz para todos los
colombianos”
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A- Existe un Estado hegemónico
(Israel) ocupando tierras robadas a Pal
B- El otro Estado es
Palestina (separado por el invasor Israeli)
C- De facto existen 2
estados: A-Israel buscando expulsar todos los Pals
D- El otro Estado –Pal- buscando
se le devuelvan las tierras usurpadas
Sol
1: Un Gbno Fed con 2 Estados. Supone a) regreso a límites de 1948
b) Gbno proporcional (50/50) electos
democ y por separado
c) Jerusalen : quasi Estado (tipo Vati)
con gobierno tripartito: J-M-C
Sol
2: Dos Estados separados en base a límites establecidos en 1948
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EU “qué
es un país cuando la hospitalidad deviene crimen ante la ley?”
Jacques
Derrida
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PRESS
TV
Global situation described by Iranian observers..
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'US has calculations against Turkey, Iran, Russia in Syria: Erdogan
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